Consumers admit using credit cards to cover monthly expenses

Inflation is forcing new combination of paychecks and plastic

Florida consumers who are struggling with the high price of everything from gasoline to food should consider a new budget mantra: “Is it a need or a want?”

ORLANDO, Fla. – Florida consumers who are struggling with the high price of everything from gasoline to food should consider a new budget mantra: “Is it a need or a want?”

That is the latest advice from veteran investment specialists who see a new trend in 2022′s inflation economy.

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Veteran financial planner Nancy Hecht told News 6 the cost of living is on an upward trend thanks in part to the Federal Reserve’s rate hike strategy.

“We are looking at (a minimum) of two more interest rate hikes, which means everything will go up again,” Hecht said this week. “I guarantee six months from now everything is going to cost more.”

That surge in consumer prices may explain the results of a recent LendingTree.com survey that found more than half of the 1,200 people surveyed admitted using credit cards to cover their monthly expenses.

Hecht has long advised against using a credit card unless the consumer is able to ”pay the bill off“ every month.

If not, “Credit card purchases should not be done unless you have no other choice,“ Hecht told News 6.

Matt Schulz, the chief credit analyst for Lending Tree, said consumers are faced with a mismatch between after-tax income, emergency savings and the monthly bills.

According to Lending Tree, for many with a salary of $35,000 or less, there may be no other choice but the credit card.

“Inflation has changed their financial margin for error,” Schulz told News 6. “A zero-percent balance transfer can be enormously helpful.”

According to Schulz, consumers could also consider a low-interest loan to consolidate debt and reduce interest.

Schulz, who worked as a financial adviser for years, said something consumers never think of is to just ask their credit card company for a lower rate.

“70 percent of people that ask for that (lower rate) get their way,” he said. “It surprises a lot of people, but far too few people ask.”

Both Hecht and Schulz advise every consumer to prepare an overview of personal expenses for both monthly and annual bills.

Hecht, a longtime financial adviser with Certified Financial Group, has prepared a personal expense summary sheet for News 6 viewers so they can take a good look at their expenses and budget within their means.

“You have to look at your lifestyle,” Hecht said. " When it comes to grocery shopping you have to be judicious in your choices, do a thorough shopping list.”

Hecht said the personal budget sheet covers everything from mortgage and rent to communications, pets and personal care. You can access this document at the bottom of this story.

She admits using store-bought hair color to supplement visits to her hairstylist and looking at labels to make sure she is getting the best price per item.

If you would like additional financial advice, email Nancy Hecht at Nancy@FinancialGroup.com

For a complete look at the LendingTree consumer survey, click here.


About the Author:

News 6’s Emmy Award-winning Investigative Reporter Mike Holfeld has made Central Florida history with major investigations that have led to new policies, legislative proposals and even -- state and national laws. If you have an issue or story idea, call Mike's office at 407-521-1322.